Rod Sims, the chair of the Australian Competition and Consumer Commission (ACCC), demanded telcos make their advertising clear and transparent and warned that the ACCC may bring legal proceedings against executives who knowingly approve misleading advertisements.
Australia’s three major telco companies – Optus, Telstra and Vodafone – all marketed ‘unlimited’ plans between March and June 2018, but services from all three companies applied speed caps for those who exceeded a certain amount of data. These people were put on a lower internet speed for the rest of their monthly billing cycle.
According to the Sydney Morning Herald, Optus also restricted tethering, streaming and downloads. Telstra also intended to slow users further during periods of general high usage on the network.
“The headline claims were, in most cases, qualified with disclaimers that were not sufficiently prominent or clear to explain to consumers the existence and impacts of the limitations, in the ACCC’s view,” the ACCC noted.
All three telcos involved emphasised their commitment to transparent marketing and working with the regulator, in comments to the Sydney Morning Herald.
The cut-throat category has already seen competing brands take legal action against one another in 2018, with Optus taking Telstra as far as the Federal Court with a complaint about its advertisement tagline: “One word for Australia’s best mobile network. Unlimited”, which was later found to be misleading.
Telstra also took Optus to court in the state of Victoria over its claim that Optus has the best mobile network in the country, and was granted an injunction which forced a halt to the marketing.
The ACCC said it has recently taken a wide range of actions against telcos over misleading and deceptive conduct in relation to NBN broadband speed claims by Telstra, Optus and iiNet and Internode.
It has also taken action in relation to the transition to the NBN, Telstra third party charges and Sprint for the unauthorised transfer of customers, among other conduct.
“With much higher penalties now available for breaches of consumer law, I hope they will take their obligations more seriously. From now on consumer law penalties will seriously affect their bottom line, and we will not hesitate to seek the highest possible penalties,” Sims said.
Sourced from ACCC, Sydney Morning Herald; additional content by WARC staff